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Global smartphone market slips 1.2% to 360m units in second quarter

The global smartphone market slipped 1.2% year on year in the second quarter to 360m units, mainly due to the declining Chinese market.

According to Counterpoint Research, the decline was for the seventh consecutive quarter while China alone accounted for over one-fourth of the global smartphone shipments.

Samsung benefited from the US-China trade war with a 7.1% growth to 76.6m and capturing more than one-fifth of the global smartphone market share.

Tarun Pathak, Associate Director at Counterpoint Research, said that Samsung has completely overhauled its product portfolio this year with its ‘A and M’ series, targeting the sub $300 price segment aggressively.

“The flagship ‘S’ series, which Samsung launched three devices instead of the usual two, covering wider price points, also continued to do well. Samsung was also one of the first OEMs to launch a 5G device – S10 5G, which remains popular in the 5G adopting countries,” he said.

After Samsung, Huawei, Oppo and ZTE launched its 5G devices.

The research company expects more than 20 million 5G devices to be shipped this year.

Huawei to face bumpy road ahead

On the other hand, Huawei, which is at the epicentre of the US-China trade war, registered a 4.6% growth during the quarter to 56.7m units, capturing a 16% market share.

Pathak said that the effect of the US ban in May did not translate into falling shipments during this quarter but it will not be the case in the future.

Speaking to TechRadar Middle East, he said that Huawei’s shipments during the second quarter were on parallel with the first quarter but the vendor did a brisk business in China compared to overseas markets.

“The uncertainty of the US ban remains as nothing on the supply chain is official yet. The chipset and component outsourcing might not be a critical factor for Huawei but the Google OS is the critical part.  It has to be seen about the refresh Mate series by the end of the year,” he said.

In the coming quarters, he said that Huawei is likely to be aggressive in its home market and register some growth there, but it will not be enough to offset for the decline in its overseas shipments.

“This will further lead to the decline of the overall smartphone market in 2019. However, the gap created in the market by Huawei gives a window of opportunity to other OEMs, especially Samsung, to leverage,” he said.

However, the real effect of trade sanctions on Huawei will be felt in the third quarter and shipments in overseas markets are estimated to register a steep decline.

Marketing muscle 

Quoting a survey conducted by the research firm in Europe, Pathak said that 40% of the people are still cool about Huawei and most expect positive for the brand.

“They [Huawei] can increase the capex of the brand by increasing warranty to two years and after-sales service. In China, the demand for Huawei phones has increased amid a slight decline in sales in other parts while consumers are upbeat about the brand,” he said.

Huawei is a brand with great marketing muscle to overcome any uncertainty in the mind of the consumers with great marketing campaigns, he said and added that things will become clear within two to three months and if Google deal does not go through, Huawei will become more aggressive going forward.

Meanwhile, Apple’s iPhone shipments fell 11.9% to 36.4m, a third consecutive quarter of decline.

“Amid the slowdown in China and likely launch of 5G capable iPhone in 2020, Apple will have to concentrate its efforts on emerging markets,” he said.

Pathak said the highlight of the quarter was Realme, a subsidiary of BBK Electronics, entering the top 10 for the first time.

Realme recorded 848% year-on-year growth in the quarter, albeit from a small base to 4.7m units.

BBK...second-largest smartphone manufacturer

BBK is now the second-largest smartphone manufacturer globally after Samsung. BBK houses Oppo, Vivo, OnePlus and Realme.

Realme recorded 848% year-on-year growth in the quarter to 4.7m units.

The combined global smartphone market share of Chinese majors Huawei, Oppo, Vivo, Xiaomi, and Realme reached 42% in the second quarter, the highest ever.

 “It took only a year for Realme to achieve this feat. This is one of the fastest ramp-ups. Strong performance in India and expansion overseas drove its growth,” he said.



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